We all negotiate every now and then. On a personal level about your salary or your bonus. Even on the purchase of a new car of TV. How about all those people meeting each other on internet sites such as Marktplaats (E-Bay).
But also as a company, for example with customers and suppliers. Although entering a negotiation might appear to be second nature to some, it can be taughtto everyone. Negotiation is a game of give and take. In order to have a good relationship with your customers and suppliers, it is important that both parties maintain a good feeling about the outcome of the negotiations.
An important factor is that you handle the negotiation process in a well structured manner. In the following chapter we will explain in more detail which components are part ofthe negotiation process and which parts you need to focus on.
1 The preparation
There is nothing like a good start. This certainly applies to situations that require negotiations.
A good preparation is essential and offers a large chance on a successful outcome of the negotiation. Before entering a negotiation, prepare yourself on these different matters:
1. Diagnosis : collectinformation on content, climate, balance of power and support.
2. Objective : what type of intrinsic result do you want to achieve.
3. Procedure : the tactical and strategic preparation.
Sub 1. The diagnosis
The diagnosis mainly consist of collecting and exchanging information. The knowledge acquired gives you the opportunity to form a realistic goal for your negotiation and structure anyalternative objectives. Next to content, the diagnosis also relates to other areas. The points of interests of these areas are mentioned below.
• Do we know enough on the subjects at hand,
• Do we have the relevant pieces, files,
• Do we know the prior history,
• Have we mobilised sufficient expertise in specialised areas, where are our interests and objectives,where are those of our opponents,
• Are there any objectives/ principles/policy decisions which apply to these negotiations, which ones do we handle, which ones do they?
• What type of atmosphere do we expect at the negotiation table,
• Is the good relationship important in relation to the future,
• Can we assess which influence we have on the climate,
• What typeof person are we dealing with, what is their negotiation style, what is the story behind the story: what are their personal interests, can we separate the standpoints from the person?
Balance of Power
• What are our opponents’ strengths and weaknesses
• In which way do we rely on them and most importantly, how do they rely on us. What are the consequences for both parties of havingno common ground, do they have any alternatives up their sleeves,
• Do we expect certain manipulations of other power struggles,
• What are the qualifications of our opponents?
• How strong do our opponents stand in relation to their support, how strong do we stand,
• Where are the support’s primary interests,
• What type of mandate do the support give,
• Whoare the support’s opinion leaders,
• How can we score points with our negation partners (and visa versa) in low cost areas,
• Does the support negotiate (constantly) or do they keep a clear distance,
• In which way do we/they need a put on a show for the support?
Sub 2. The Objective
You can decide the objective at any given time during the preparation. For example, you candetermine your objective first and then search for information, strategy and tactics you think you might need in order to achieve your objective. However, in most cases the objective is more easily quantifiable after the diagnosis. Imagine, you would like to charge your supplier for 10% lower delivery costs. Yet, without the diagnostic phase you do not know whether this is realistic. You might...